In a major step towards improving California's rail infrastructure, the US Department of Transportation (DOT) has announced a $31.4 million loan to support upgrades to critical rail lines in the Central Valley and Mendocino County. This financial assistance, provided through the Railroad Rehabilitation and Improvement Financing (RRIF) program of the DOT's Build America Bureau, is designed to improve safety, efficiency, and supply chain operations in the region.
The substantial loan will fund nearly all of the costs of planned expansion and rehabilitation projects by the Sierra Northern Railway (SNR) and the Mendocino Railway (MRY). Key projects include the addition of 6.7 miles of track on the Oakdale Branch for engine and car storage by SNR and major improvements by MRY, including the rehabilitation of Noyo Canyon Tunnel No. 1, 27 bridges, and 40 miles of track.
Deputy Secretary Polly Trottenberg highlighted the project's alignment with the Biden-Harris Administration's commitment to clean transportation and supply chain enhancement. She noted that the initiative is expected to "increase safety, reduce harmful greenhouse gas emissions, and improve freight service benefitting the entire region.”
Build America Bureau Executive Director Morteza Farajian highlighted the loan's role in upgrading the rail line, which will improve freight service and attract new customers. Scheduled for completion in 2027, the project promises to improve safety and operational capacity, while significantly reducing derailments, grade crossing incidents, local road congestion, and air pollution.
This funding is the first loan to a short-line (Class III) railroad since the Bureau was established in 2016, and demonstrates the federal government's support for small railroads through a dedicated $7 billion set aside under the RRIF program. To date, DOT has closed $7.6 billion in RRIF loans and $39.8 billion in Transportation Infrastructure Finance and Innovation Act (TIFIA) financings, contributing to more than $143 billion in infrastructure investment nationwide.